It’s the title of a research note published by economics from Deutsche bank, which explains why the ECB and the Federal Reserve acted so differently during the economic crisis.
While the ECB raised interest rates to attack inflation, the Fed thought about growth in the first place and waited to give the economy more time to recover.
The research note says that the differences between the central banks can’t be caused by the difference in economic climate, because everybody knows that due to globalization, the economic climate has become worldwide.
It points out that the differences could be explained if we look at the economic history of both regions. In the United States the biggest economic trauma is without any doubt the economic crisis of the thirties, while in Europe the hyperinflation in Germany after world war I had a bigger impact.
Eva Van Belle
Source: http://blogs.wsj.com/economics/2008/07/03/ecb-and-fed-worlds-apart/
1 opmerking:
Good effort to limit the number of subjects and consequently good focus. Flow is hampered in S3.
One sentence too many (briefing)
Title: Mars [capital]
S1: research paper (voor onderzoeksnota)
S1: economists from DB
S3: the research paper states that
S3: compilation of subclauses hampers flow
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